GOBanking Rates Score
- Refund flexibility
- purchase size
How did we calculate this?
- You can split purchases into smaller payments and pay over time.
- Millions of online stores accept PayPal payments.
- You can get an instant approval decision.
- There are no fees to pay with the service and payments are interest free.
- Purchases are limited to $1,500.
- Pay in 4 is only available from online merchants that accept PayPal.
- PayPal offers fewer refund options than its competitors.
What is PayPal Pay in 4?
PayPal Pay in 4 is a payment option that lets you split the purchases you make at participating online stores into four payments. You pay a deposit at the time of the sale and then a payment every two weeks for the following six weeks, for a total financing period of six weeks.
How does Pay in 4 work?
To use PayPal’s Pay in 4 option, the seller must support PayPal payments. This means that you can use this option in millions of online stores that support PayPal. Popular merchants include Best Buy, Target, Bed Bath & Beyond and Lands’ End.
When you checkout, choose PayPal and select the “Pay Later” option. This will allow you to choose the “Pay in 4” payment method. You will receive a link to the loan agreement to review and agree to before submitting your application. You will also receive an email from PayPal with your plan details once the purchase is complete.
When you try to pay, PayPal will automatically make an approval decision in seconds so you can complete your purchase immediately.
To complete your purchase, you will need to pay the first payment as a deposit. The remainder of the purchase amount is divided into three interest-free payments, one due every two weeks. You can manage and make payments online or through the PayPal application, available at iOS and android.
If you are declined for the plan, you can still use PayPal to pay; you will just need to choose another payment method in your wallet. PayPal will send you an email stating the reason why you were declined.
Does it pay in 4 billing fees?
There are no fees to use Pay in 4. Payments are interest free. However, PayPal may charge late fees if you are late with a payment, depending on your state of residence.
Does Pay in 4 affect your credit score?
PayPal may perform a soft credit check when you request Pay in 4, but this will not affect your score.
A soft credit check gives the lender the opportunity to review your credit report and determine your creditworthiness. Although these informal checks do not affect your credit score, they are listed on your credit report.
Who can use Pay in 4 and what purchases are eligible?
PayPal offers the Pay in 4 plan to a growing number of US customers. There are a few eligibility requirements:
- Availability depends on your state.
- You must be at least 18 years old.
- Your PayPal account must be open and in good standing.
Currently, PayPal offers Pay in 4 in all states except Missouri, New Mexico, Nevada, North Dakota, Wisconsin, and US Territories. However, not everyone is approved. Approval is dependent on PayPal’s internal checks and prior verification of your credit score.
You can use Pay in 4 at merchants that accept PayPal payments in any supported currency. PayPal will automatically convert the purchase amount to US dollars during the checkout process.
There are also purchase amount limits for Pay in 4; you can only use this payment method for transaction amounts between $30 and $1,500.
PayPal does not allow Pay in 4 for certain recurring subscription services, according to PayPal’s website, and availability depends on the merchant.
Can you refund a Pay in 4 plan early?
When you start a Pay in 4 plan, you pay the first payment at the time of purchase. To see your remaining payments, you can log into the PayPal website or app to view your account summary. Your account summary shows your total purchases and their dates, the number of payments you’ve made and your total payments to date, your remaining balance, and the date and amount of your next payment due.
From there, you can make an additional payment or pay off the entire plan early. There are no penalties or additional charges for paying it back early.
Any additional payments are applied and displayed immediately in your plan activity.
PayPal Pay in 4 vs competitors
More and more companies are offering buy now, pay later, so PayPal isn’t the only option available. Here are some competitors to know.
Klarna was founded in 2005 in Sweden and also offers a Pay in 4 plan. Like PayPal, you can pay for your purchase with four interest-free payments over time. Klarna also offers 30-day payment and monthly financing options.
Like the others, Sezzle offers a four-payment plan. As long as you make your payments on time, there are no fees and payments are interest-free. Sezzle is currently accepted at more than 44,000 online stores. Unlike PayPal, Sezzle does not have fixed credit limits. Sezzle estimates your limit with each purchase based on a soft credit check, order history with the service, length of your customer base, and a few other factors.
Affirm offers a buy now, pay later loan with an interest rate based on the term of your loan and your credit. Your rate will be 0% or 10% to 30% APR. The purchase limit for Affirm is $17,500 and a deposit may be required.
Afterpay also offers a four-payment plan that refunds your purchases in six weeks. To register, you will need your email address, phone number, physical address, date of birth, and a debit or credit card. There’s no interest, but you could be hit with late fees totaling 25% of your purchase if you fall behind on your payments.
Takeout on PayPal Pay in 4
PayPal’s Pay in 4 feature is a great option if you want to make a large purchase more affordable by paying for it over time. This only works if the merchant accepts PayPal, but millions of online stores do. You’ll get interest-free payments every two weeks, and you can pay them off earlier if you want.
keep in mind
Buy now, pay later plans are exploding in popularity. Still, analysts warn of rising credit card debt and balances, especially for younger consumers. Always make sure you can afford the payments before buying.
PayPal Pay in 4 FAQs
Buy now, pay later services are growing in popularity, but are still unfamiliar to many consumers. These FAQs will help you better understand how PayPal Pay in 4 works.
- What is PayPal Pay in 4?
- PayPal Pay in 4 is a loan issued by PayPal that allows you to make purchases today with a down payment and pay the rest over time.
- How does PayPal Pay in 4 work?
- When you select PayPal and then Pay later at checkout, you complete a brief request. Once approved by PayPal, you will pay 25% of the purchase price as a deposit and make an additional payment once every two weeks for the next six weeks.
- Does PayPal pay in 4 credit checks?
- Yes. PayPal is making an informal inquiry, which will appear on your credit report but will not impact your credit score.
- Can my PayPal Pay in 4 request be refused?
- Yes. PayPal states that it does not endorse 100% of Pay in 4 apps.
- Who accepts PayPal Pay in 4?
- PayPal Pay in 4 is available at millions of online stores including Coach, Samsonite, Target, Best Buy and Bed Bath & Beyond.
- How can I get help with my PayPal Pay in 4 account?
- PayPal has an FAQ page with answers to common customer service questions. If you can’t find an answer there, you can send a message to PayPal from the FAQ page or call customer service. Calling is faster if you log into your account first, but you can call as a guest if you prefer. The number is 888-221-1161, and it’s available Monday through Saturday, 6 a.m. to 6 p.m. Pacific Time.
Daria Uhlig contributed reporting for this article.
The information is accurate as of January 30, 2022.